AIG Posts Profit of $455 Million

Bailed out insurance giant AIG on Friday announced a profit of 455 million dollars in the third quarter, a massive turnaround from a 24.4 billion dollar loss in the same period last year.

The earnings from group, the largest recipient of US government aid during the financial crisis, were better than expectations.

Excluding special items, the profit was 2.85 dollars per share, compared with a market forecast of 1.98 dollars per share.

It was the second consecutive quarterly profit for American International Group after the prior quarter's earnings of 1.8 billion dollars.

"Our results reflect continued stabilization in performance and market trends," said AIG president and chief executive Robert Benmosche.

"AIG employees are working to preserve the strength of our insurance businesses in a challenging market by working closely with our distribution partners, with third quarter 2009 showing signs of stabilization."

AIG was the largest single recipient of US bailouts with the government pumping more than 170 billion dollars into the firm to keep it afloat and taking a controlling stake in the group in the process.

Once the world's biggest insurer, AIG was on the brink of bankruptcy in September 2008 when the government offered a financial lifeline in exchange for an 80 percent stake in the company.

The company was in trouble after backing trillions of dollars in risky financial products amid a US home mortgage meltdown that triggered a global financial crisis.

The latest quarterly figures showed revenues fell 11.8 percent to 26 billion dollars as AIG sold off some or wound down of its operations.

AIG said it "continues to make progress on its disposition plan," having entered into agreements to sell or completed the sale of operations and assets to generate a total of 5.6 billion dollars.

A government report in September showed AIG still owed nearly 121 billion dollars in taxpayer aid.

The Government Accountability Office, an investigative arm of Congress, said the ultimate success of AIG?s restructuring and repayment efforts remains "uncertain."

Can we get some of our money back now? Though clearly they have a long way to go to pay it all back.

Goldman Sachs: Pure Evil

Somebody fucking needs to go to jail:

WASHINGTON — In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.

Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.

Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws.

"The Securities and Exchange Commission should be very interested in any financial company that secretly decides a financial product is a loser and then goes out and actively markets that product or very similar products to unsuspecting customers without disclosing its true opinion," said Laurence Kotlikoff, a Boston University economics professor who's proposed a massive overhaul of the nation's banks. "This is fraud and should be prosecuted."